Wednesday, April 18, 2007

High gas prices and big profits

It seems a little too convenient to me that oil refiners point to environmental laws as reasons they can’t increase capacity. This same lack of increased capacity is their reason behind rising pump prices.

While I don’t begrudge a business for making profits, I do take exception when their profits are breaking all historic records. Why on earth would they want to build more capacity, killing the golden goose and spending their windfall to do it?

Increases in gas prices won’t kill the economy but they will put a squeeze on Americans, further depressing any forward momentum this economy has left, if any.
Behind high gas prices: The refinery crunch
When gasoline prices surge, a lack of refining capacity is often blamed. What's being done, and is it enough?
"Everyone is quick to say "look at these refiners, they're driving up the price,'" said Phil Flynn Flynn, senior market analyst at Alaron Trading in Chicago. "But if I wanted to build a refinery tomorrow, I couldn't do it."
And then there's the public's newfound concern over global warming and its supposed commitment to do something about it. President Bush himself has called for a 20 percent reduction in gasoline use over the next 10 years.


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